3 weeks ago
More and much companies are attracted to the thought of launching their ain Ethereum furniture 2 network. Most of them shouldn’t bother. There’s already a staggering fig of them — over 150. Quite a fewer of these are centralized and linked to a azygous endeavor and respective companies specified arsenic Robinhood person precocious announced plans to motorboat their ain furniture 2 networks.
The attractions for launching an Ethereum furniture 2 web are significant, particularly erstwhile compared to launching your ain furniture 1 (foundation layer) blockchain. Layer 1 networks indispensable vie with networks similar Ethereum and Solana successful an already intensely competitory and crowded market. Layer 2 networks that tally connected apical of Ethereum besides look an intensely competitory marketplace but tin simultaneously gully upon the spot of the Ethereum ecosystem, acknowledgment to heavy integration into Ethereum itself.
With Ethereum having turned 10 successful July, it remains the ascendant astute declaration blockchain and it is the largest azygous location for integer assets, real-world assets (RWA), stablecoins and decentralized concern applications. Ethereum’s stock of the wide decentralized concern ecosystem has been unchangeable astatine astir 50% for 3 years now. When furniture 2 networks are included successful the total, it appears to beryllium rising modestly.
The temptation to motorboat your ain Ethereum furniture 2 web is casual to recognize — they look similar a utile conception with large economics. A furniture 2 web connected apical of Ethereum offers a spot of “best of some worlds” functionality: you tin power your ain ecosystem wrong your furniture 2 but clasp integration with and entree to the wide Ethereum ecosystem. Centralized furniture 2 networks tin acceptable their ain terms structures and person astir each the aforesaid controls arsenic a stand-alone backstage blockchain specified arsenic deciding who has entree to the web and what benignant of information volition beryllium disposable to others.
This comes with a cost. Layer 2 networks indispensable acquisition transaction processing abstraction connected the Ethereum mainnet to finalize their transactions (known arsenic blob space) — but those costs are apt to beryllium little than those associated with starting a web from scratch and competing head-on with Ethereum. In fact, according to Token Terminal, the costs of processing a furniture 2 are remarkably low. For Base, a furniture 2 web tally by Coinbase, during June of 2025, the web generated $4.9 cardinal successful interest gross and spent conscionable $50,000 connected furniture 1 colony fees.
Indeed, the furniture 1 colony fees connected Ethereum are truthful debased they person acceptable disconnected a fiery statement wrong the web ecosystem astir whether they are excessively low, and that furniture 2 networks correspond a transportation of benefits from furniture 1 stakeholders to furniture 2 networks. It is apt this volition effect successful immoderate re-balancing of fees, but adjacent a 10x summation successful fees is not apt to change the fundamentally bully worth proposition that comes with scaling with furniture 2 networks.
Furthermore, the caller announcement by Robinhood that they volition beryllium gathering their ain furniture 2 web connected Ethereum fundamentally validates the wide furniture 2 thesis wrong Ethereum: furniture 2 networks are not lone a bully scaling option, they besides alteration a assortment of concern models that volition entice a wide scope of companies to articulation the network.The furniture 2 ecosystem is apt to person a scope of participants from the afloat decentralized to the wholly centralized.
And this brings america to the cardinal question: does your institution request its ain furniture 2 network? Chances are, you don’t. The existent worth proposition of a blockchain ecosystem is the quality to enactment successful practice with others without immoderate 1 enactment controlling the network. If you’re a manufacturing company, for example, you privation to enactment with your suppliers and customers connected a level playing tract with your competitors. Blockchains fto everyone articulation successful without favoring immoderate 1 participant. In the agelong run, moving unneurotic connected a level playing tract is overmuch cheaper and preferable to trying to integrate into antithetic systems controlled by each 1 of your cardinal customers oregon suppliers.
While immoderate furniture 2 networks look precise profitable close now, this is lone existent if you tin make bully transaction volume. Many of the furniture 2 networks operating are doing small to nary concern arsenic they conflict to differentiate themselves successful a crowded market. According to L2Beat, astir of these networks person little than $1mm successful TVL bridged successful from Ethereum and are averaging little than 1 idiosyncratic cognition per second.
So erstwhile does a institution request its ain furniture 2 network? My proposal is that this works champion for firms that tin aggregate important transaction measurement into the web and whose customers bash not person the means oregon the idiosyncratic measurement to marque their ain nonstop transportation to Ethereum. Right now, that mostly means fiscal services firms that person thousands oregon millions of retail customers, from Coinbase to Kraken to Robinhood. More firms volition surely follow. Having a furniture 2 web mightiness beryllium seen, successful the future, the mode we looked astatine having a spot connected the New York Stock Exchange. Brokerage firms would privation them, but a car shaper wouldn’t find worth successful it.
Three questions would beryllium utile successful determining if a steadfast should motorboat its ain Ethereum furniture 2 network: first, is the institution capable to aggregate a important measurement of its ain transactions oregon clients compared to different networks? Second, is transacting on-chain cardinal to the company’s halfway concern exemplary (e.g., are you an intermediary, particularly a fiscal 1 that presently transacts connected accepted fiscal rails). Lastly, does your furniture 2 attack connection a differentiated worth proposition compared to the galore different web options retired there? If you tin accidental yes to each 3 options, this is simply a imaginable way forward.
For astir different types of firms, they whitethorn find the optimal worth proposition to beryllium connecting straight to Ethereum, oregon 1 of the different unfastened furniture 2 networks. It volition beryllium little costly and much backstage than going done an aggregator who volition beryllium capable to people up your transaction costs and spot your transaction travel and little costly than moving your ain network.
I suspect, however, that earlier we are done, rather a fewer firms that person nary request to tally their ain furniture 2 volition motorboat 1 anyhow for the aforesaid reasons galore firms launched backstage chains successful the past.
No substance however reliably they person failed, the attraction of backstage blockchains was ever hard to counter. The allure of “controlling your destiny” and “taxing the ecosystem” was hard to resist. Public chains, with their openness, interoperability, and permissionless quality tin look scary to concern users who would similar much control.
To the aforesaid buyers who wanted backstage chains, centralized furniture 2 networks look similar a halfway location that whitethorn look appealing. Unlike backstage chains, I don’t deliberation they are each doomed to fail, but I bash fishy lone a fewer volition succeed. History keeps repeating itself - mostly due to the fact that we’re not precise bully astatine paying attraction to it. Here we spell again.
Disclaimer: These are the idiosyncratic views of the writer and bash not correspond the views of EY.
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